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Hanger Orthopedic Now Hanger Inc. - Analyst Blog

Hanger Orthopedic Group Inc.
(
HGR
) will henceforth be known as Hanger, Inc., effective June 8, 2012.
Management announced that the previous name was limiting and the
move is part of the company's branding initiative to promote its
other businesses, apart from orthotic and prosthetic ("O&P")
patient care products.

The 150-year old Texas-based company has been aggressively
conducting research with stakeholders since 2010 to diversify its
business, which has led to the renaming of Hanger O&P patient
care segment to Hanger Clinic. The company has evolved into a major
provider of therapeutic and rehabilitative offerings and
services.

Although Hanger has renamed itself, it will continue with the
same lines of business and trade on the New York Stock Exchange
under the existing ticker symbol "HGR." The new name will be
incorporated in the company's logos, designs, Hanger Clinic patient
care centers and all communications across Hanger's franchises.

Hanger operates in three business segments: Patient-Care
centers, Distribution and Therapeutic Solutions. Patient-Care
centers provide O&P devices to patients, and operate
fabrication centers for O&P components. Additionally, the
Patient-care center segment runs a national managed care agent for
O&P services and a patient referral-clearing house called
OPNET.

The Distribution business segment supplies O&P products and
components to the O&P industry, including the company's own
Patient-care centers. Hanger's Therapeutic Solutions division
offers services to the O&P market and post-acute rehabilitation
market through its subsidiaries, Innovative Neurotronics and
Accelerated Care Plus ("ACP").

Hanger leads in the O&P patient care services market,
operating across more than 700 patient care centers in the U.S. The
company's economies of scale are unmatched by competition, which
include notable players in the O&P space such as
Orthofix International
(
OFIX
),
Conmed Corp.
(
CNMD
),
Exactech Inc.
(
EXAC
) and
Owens & Minor Inc
. (
OMI
).

However, we are cautious about the company's exposure to
reimbursement uncertainties and its aggressive acquisition
strategy, which has inherent risks. We currently have a Neutral
rating on Hanger. The stock retains a short-term Zacks #2 Rank
(Buy).

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